Asian Currencies Rise, Led by Won, on Global Stimulus Optimism

June 7 (Bloomberg) -- Asian currencies rose, led by South
Korea’s won and the Indian rupee, on speculation global policy
makers will announce stimulus measures to spur economic growth
and tackle Europe’s debt crisis.

“The risk aversion and the flight to safety may have eased
given the U.S. is likely to consider a move to add further
liquidity,” said Yeah Kim Leng, chief economist at RAM Holdings
Bhd. in Kuala Lumpur. “In the short term, if the ECB acts, it
will ease market concerns and we will see Asian currencies
either stabilizing or regaining some lost ground.”

The won climbed 0.7 percent from its June 5 close to
1,171.45 per dollar, according to data compiled Bloomberg. South
Korea’s financial markets were shut yesterday for a holiday.
The rupee rose 0.6 percent to 55.0587 and Malaysia’s ringgit
advanced 0.5 percent to 3.1640. Taiwan’s dollar gained 0.1
percent to NT$29.906 and Thailand’s baht weakened 0.1 percent to
31.51.

Concerns Remain

The Bloomberg-JPMorgan Asia Dollar Index, which tracks the
region’s 10 most-used currencies excluding the yen, reached
114.70, the highest level in more than a week. The gauge
declined in each of the last five weeks, its longest losing
streak since 2008, as Europe’s debt crisis worsened and Chinese
data pointed to a deepening slowdown in Asia’s biggest economy.

“Governments are rolling out measures to save their
economies,” said Tobby Lin, a bond trader at Yuanta Securities
Co. in Taipei. “It’s boosting risk appetite a bit, but concerns
over Europe’s crisis still exist for sure.”

The Group of Seven nations agreed this week to coordinate
their response to Europe’s turmoil, which has tipped at least
eight of the 17 euro-area economies into recession and is
threatening the global economy.

The yuan was unchanged at 6.3635 per dollar in Shanghai.
China said it will introduce new capital-adequacy requirements
for lenders at the beginning of next year, having announced in
August they would start being applied from Jan. 1, 2012. The
People’s Bank of China raised the reference rate 0.14 percent,
the most since May 21, to 6.3170.

“China is showing its determination to support growth as
it ensures there’s bank capital to support lending demand,”
said Dariusz Kowalczyk, a Hong Kong-based strategist at Credit
Agricole CIB. That’s positive for the yuan, he said.

Elsewhere, the Philippine peso rose 0.1 percent to 43.158
per dollar. Indonesia’s rupiah weakened 1 percent to 9,398 and
the Vietnamese dong held at 21,001.